Dropping consumer confidence

From Kansascity.com : Consumer confidence weakened in August in the United States as Americans focused on turbulent financial markets, a decline in home prices and tighter credit standards.

The New York-based Conference Board said Tuesday its Consumer Confidence Index, declined to 105.0 from a revised reading of 111.9 in July, which was still a six-year high. Although the index was down, it was slightly stronger than the 104.5 that Wall Street analysts expected.

The survey is closely watched because consumer spending represents two-thirds of the U.S. economy and confidence levels tend to influence spending. The consumer confidence survey from the Conference Board is based on a representative sample of 5,000 U.S. households to measure consumer sentiment on present economic conditions and the spending outlook for the next six months. The index was based at 100 in 1985.

The dip in consumer confidence is not restricted to the US. In Germany too, consumer confidence has dropped.